City side financial services Diversity Problem

Matthew Richard
University of Auckland
Introduction:
By 1999, Cityside Financial Services sales division has two units: Retail Operations operated by black
employees, External Deposits operated by white employees (Ely, 2006). Background: Founded in
1930, Cityside Financial Services was a successful midsized bank serving an urban community in a
predominantly white, upper-middle-class neighborhood. It was purchased by a radically diverse
group of investors, including Ron Wilkins, a young black investment banker (Ely, 2006). Problem: By
2004, Wilkins founded that customers are being differentiated by form of services offered to them
depending on their locality, if they were local to the neighborhood or not (Ely, 2006). Both units
started blaming each other (Ely, 2006). Opportunities: The management should have tried to reduce
the communication gap between both the units and provide the individuals a chance to improve
their potential in a field of interest. Recommendations: "Managing diversity means understanding its
effects and implementing behaviors, work practices and policies that respond to them in an
effective way" (Cox, 2001). "Everyone in an organization wants to do a good job" (Menke et al.,
2006). Conclusion: Diversity management plays a very critical role in an organization. It can be used
to develop an organization or it can lead to failure of an organization. Cityside Financial Services
used affirmative action to hire employees that fit personally with the communities it served. It used
a two-part strategy to conduct business: reinvesting in the neighborhood businesses and housing
development and attracting investments from wealthy clientele. Two units in the Sales Division,
Retail and External Deposits, offered services to grow the neighborhood. The goal was to hire
women and African-Americans in order to speak to local clients. The Retail Department offered loans
to small businesses, savings accounts, and home mortgages. The External Deposits Department
offers money markets, IRA accounts, and CDs. In order to gain the diverse workforce the owner
wanted, a hiring program was put in place that would benefit minorities. The Retail Department
hired women, who became nearly half of that department's staff. Meanwhile, the External Deposits
Department continued to hire and retain mainly white males with college degrees. Despite the
difference in demographic of the staffs of the separate departments, Cityside Financial Services
became known for having a diverse staff. Internally, there was not enough cooperation between the
two departments, which caused the customer service to take a hit.

Cityside Financial Services faxed all if the challenges to managing diversity as it was going from a
predominantly white organization to a more diverse institution, offering positions to minorities like
women and African-Americans. The management had to be prepared for any challenge or barrier to
arise. Current employees may have an inaccurate stereotype or prejudice about incoming,
prospective, or current employees that would negatively affect the working environment, especially
if those employees are of various backgrounds, presenting ethnocentrism. References: 1)
Refrences:

1.) https://www.termpaperwarehouse.com/essay-on/Cityside-Case-Answers/237643

2) https://www.termpaperwarehouse.com/essay-on/Cityside-Financial-Services/232718

3) Cox, Jr. T. (2001). Creating the multicultural organization: A strategy for capturing the power of
diversity, Jossey-Bass, San Fransisco, pp. 3-16.

4) Ely, R. (2004). Managing diversity at cityside financial services. Harvard Business School, 1-4.

5) Menke, M., Xu, Q., & Gu, L. (2006). An analysis of the universality, flexibility, and agility of total
innovation management: a case study of Hewlett – Packard, Journal of Technology Transfer,

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